Attached files
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| 8-K - FORM 8-K - Echo Therapeutics, Inc. | ecte8k_8koct192016.htm |
Exhibit
10.1
PROMISSORY NOTE
(Bridge Note)
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$125,000
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Iselin,
NJ
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October
19, 2016
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FOR VALUE RECEIVED, ECHO THERAPEUTICS INC., a Delaware
corporation (together with its successors and assigns, the
“Borrower”), with its
principal place of business at 99 Wood Avenue South, Suite 302,
Iselin, New Jersey 08830, promises to pay to the order of NETWORK
VICTORY LIMITED ( together
with any successors or assigns, the “Lender”) at the office of
the Lender, PO BOX
957, OFFSHORE INCORPORATION CENTER. ROAD TOWN, TORTOLA, BRITTISH
VIRGIN ISLANDS, the sum of ONE HUNDRED TWENTY FIVE THOUSAND DOLLARS
and ZERO cents ($125,000.00), together with interest on the unpaid
balance and all other charges, as provided below. Commencing on the
date hereof, interest shall accrue on the unpaid principal balance
outstanding from time to time at a rate per annum equal to 18%,
compounding monthly. The Borrower shall pay all outstanding
principal and interest on the Maturity Date. “Maturity Date” is defined
as earlier of (i) the consummation of the sale by the Borrower of
equity securities in an offering, with gross proceeds to the
Borrower (before deduction of underwriter’s commissions,
offering expenses and the like) of not less than $1,000,000 and
(ii) one hundred twenty (120) days from the date hereof. To the
extent permitted by applicable law, upon and after the occurrence
of an Event of Default (whether or not the Lender has accelerated
payment of this Note), interest on principal shall be payable on
demand at a rate per annum equal to 24% per annum, compounding
monthly. This Note is unsecured and is subordinated and junior, in
payment and priority, to the Secured Convertible Notes of the
Borrower issued on January 29, 2016 and May 3, 2016.
Default. If
(a) the interest hereon or any commitment or other fee shall not be
paid in full punctually when due and payable, and/or (b) the
principal hereof shall not be paid in full punctually when due and
payable, it shall constitute an Event of Default
(“Event of
Default”) under this Note. Upon an Event of Default,
or at any time thereafter, at the option of the Lender, all
obligations hereunder shall become immediately due and payable
without notice or demand and the Lender shall then have in any
jurisdiction where enforcement hereof is sought. All rights and
remedies of the Lender are cumulative and are not exclusive of any
rights or remedies provided by laws or any other agreement, and may
be exercised separately or concurrently.
Waiver;
Amendment. No delay
or omission on the part of the Lender in exercising any right
hereunder shall operate as a waiver of such right or of any other
right under this Note. No waiver of any right contained in, consent
to any departure from, or amendment to any provision contained in
this Note shall be effective unless in writing and signed by the
Lender, nor shall a waiver on one occasion be construed as a waiver
of any such right on any future occasion. Without limiting the
generality of the foregoing, the acceptance by the Lender of any
late payment shall not be deemed to be a waiver of the Event of
Default arising as a consequence thereof. The Borrower waives
presentment, demand, notice, protest and all other demands and
notices in connection with the delivery, acceptance, performance,
default or enforcement of this Note and assents to any extensions
or postponements of the time of payment or any and all other
indulgences under this Note, or to any and all additions or
releases of any other parties or persons primarily or secondarily
liable under this Note, which from time to time be granted by the
Lender in connection herewith regardless of the number or period of
any extensions.
Governing Law;
Consent to Jurisdiction. This Note shall be governed by, and
construed in accordance with, the laws of the State of New Jersey
without regard to any conflict of laws provisions that might result
in the application of the laws of another state. The Borrower
agrees that any suit for the enforcement of this Note may be
brought in the courts of the State of New Jersey or any federal
court sitting in such state and consents to the non-exclusive
jurisdiction of each such court and to service of process in any
such suit being made upon the Borrower by mail at the address set
forth above. The Borrower hereby waives any objection that it may
now or hereafter have to the venue of any such suit or any such
court or that such suit was brought in an inconvenient
court.
{00145512.1}
WAIVER OF JURY TRIAL. THE BORROWER AND THE LENDER, BY ITS
ACCEPTANCE OF THIS NOTE, HEREBY WAIVE TRIAL BY JURY IN ANY
LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR
ARISING OUT OF: (A) THIS NOTE OR ANY OTHER INSTRUMENT OR
DOCUMENT DELIVERED IN CONNECTION WITH THE OBLIGATIONS HEREUNDER;
(B) THE VALIDITY, INTERPRETATION, COLLECTION OR ENFORCEMENT
THEREOF; OR (C) ANY OTHER CLAIM OR DISPUTE HOWEVER ARISING BETWEEN
THE BORROWER AND THE LENDER.
Severability;
Authorization to Complete; Paragraph Headings. If any provision of this Note shall be
invalid, illegal or unenforceable, such provision shall be
severable from the remainder of this Note and
the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Paragraph headings are for the convenience of reference only and
are not a part of this Note and shall not affect its
interpretation. All pronouns and any variations thereof shall be
deemed to refer to the masculine, feminine, neuter, singular or
plural, as the identity of the person, persons, entity or entities
may require. The terms “herein,” “hereof”
or “hereunder” or similar terms used in this Note refer
to this entire Note and not only to the particular provision in
which the term is used.
Exchange
Right. For so long as
this Note is outstanding, if the Company enters into any subsequent
equity or equity-linked financing on terms more favorable than the
terms governing this Note (a “Subsequent Financing”),
as determined by the Lender in its sole discretion, then the Lender
in its sole discretion may exchange the outstanding principal and
interest under this Note for the securities issued or to be issued
in the Subsequent Financing. In no event shall any such
exchange be permitted to the extent such exchange results in the
Lender beneficially owning (for purposes of Section 13(d) under the
Securities Exchange Act of 1934) 9.99% or more of the outstanding
Common Stock of the Company.
Assignments.
Neither this Note nor the proceeds hereof shall be assignable by
the Borrower without the Lender’s prior written consent, and
any attempted assignment without the Lender’s prior written
consent shall create a default under this Note. This Note may be
assigned, in whole or in part, by the Lender and its successors or
assigns. The Borrower’s consent shall not be required for any
such assignment.
IN
WITNESS WHEREOF, the Borrower has caused this Note to be duly
executed and delivered as of the date first above
written.
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ECHO THERAPEUTICS INC.
By:
/s/Alan
Schoenbart
Name:
Alan W. Schoenbart
Title:
Chief Financial Officer
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